Tornado Global Hydrovacs Announces Closing of Common Share Private Placement, Shares for Debt Transaction, and Unit Private Placement, and Announces Rights Offering
CALGARY, September 18, 2017 – With reference to its prior news release dated August 1, 2017, Tornado Global Hydrovacs LTD. (TSX-V: TGH) (“Tornado” or the “Corporation”) is pleased to announce the closing of the Common Share Private Placement, the Shares for Debt Transaction, and the Unit Private Placement. Furthermore, the Corporation is pleased to announce that it is commencing a rights offering.
Common Share Private Placement
The Corporation completed a non-brokered private placement (the “Common Share Private Placement”) in which Excellence Raise Overseas Limited (the “Subscriber”) purchased 27,777,778 Class “A” Common Shares (“Common Shares”) in the capital of the Corporation at a price of $0.09 per Common Share for aggregate gross proceeds of CDN $2,500,000. The investment by the Subscriber in the Common Share Private Placement is in lieu of prior commitment made by the Subscriber to provide a subordinated loan to the Corporation’s wholly owned subsidiary in China. The Common Shares issued pursuant to the Common Share Private Placement are subject to a four month and one day hold period.
Shares for Debt Transaction
The Corporation completed a shares for debt transaction in which Empire Industries Ltd. (“Empire”) agreed to accept 30,185,544 Common Shares of the Corporation at price of $0.09 per Common Share (the “Shares for Debt Transaction”) as payment for a CDN $2,716,699 debt owed by Tornado to Empire pursuant to a secured term loan. The Common Shares issued pursuant to the Shares for Debt Transaction are subject to a four month and one day hold period.
Unit Private Placement
The Corporation has completed a non-brokered private placement of 3,100,000 units (the “Unit Private Placement”) at a price of $0.09 per Unit for aggregate gross proceeds of CDN $279,000. Each unit (“Unit”) consists of one (1) Common Share in the capital of the Corporation and one (1) Common Share purchase warrant (each a “Warrant”). Each Warrant entitles the holder to acquire one (1) additional Common Share in the capital of the Corporation (each a “Warrant Share”) at an exercise price of $0.12 per Warrant Share for a period of five (5) years from the closing of the Unit Private Placement. The Common Shares and Warrants issued pursuant to the Unit Private Placement will be subject to a four month and one day hold period.
Following these transactions, the Corporation has 120,544,165 Common Shares outstanding.
Announcement of Rights Offering
The Corporation is commencing a rights offering to holders of its Common Shares at the close of business on September 26, 2017 (the “Record Date”) on the basis of one right (each a “Right” and together the “Rights”) for each issued and outstanding Common Share. Each Right will entitle the holder to subscribe for one Common Share at a price of $0.085 per Common Share.
The rights offering will be conducted in Canada. The rights will expire at 5:00 p.m. (Toronto time) on October 30, 2017 after which time unexercised rights will be void and of no value.
Details of the offering will be set out in the offering notice and offering circular which will be available under Tornado’s profile at www.sedar.com and on Tornado’s website at www.tornadotrucks.com. The offering notice and accompanying rights certificate will be mailed to each shareholder of Tornado resident in Canada as at the Record Date. Registered shareholders who wish to exercise their rights must forward the completed rights certificate, together with the applicable funds, to the rights agent, AST Trust Company (Canada), on or before the expiry time. Shareholders who own their common shares through an intermediary, such as a bank, trust company, securities dealer or broker, will receive materials and instructions from their intermediary.
Tornado will not issue or forward rights certificates to shareholders resident in a jurisdiction outside of Canada. The rights certificates of such shareholders will be issued to and held on their behalf by AST Trust Company (Canada) until the expiry time.
Empire Industries Ltd., Excellence Raise Overseas Limited, Shanghai Pursuance Intelligence Technologies Limited Partnership, James Chui and Huang Chao who currently collectively hold 85,165,772 Common Shares (representing 70.7% of the issued and outstanding Common Shares of the Corporation) will be issued Rights in accordance with applicable securities laws. However, they have agreed not to transfer or exercise any of their Rights. Accordingly, a maximum of 35,378,393 Common Shares should be issuable under the rights offering.
About Tornado Global Hydrovacs Ltd.
The Company designs and manufactures hydrovac trucks in Canada and sells hydrovac trucks for excavation service providers to the oil and gas industry and the municipal markets in Canada and the USA. Hydrovac trucks use high pressure water to pulverize soil and turn it into mud, and then vacuum up the resulting mud into its tank. Tornado currently operates in North America. The Company intends to expand its hydrovac business into China and has established a wholly owned operation in China with a head office in Beijing.
Chief Executive Officer
Phone: (403) 204-6333
Chief Financial Officer
Phone (403) 204-6363
Neither the Exchange nor its Regulation Service Provider (as that term is defined in policies of the Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Certain statements contained in this news release constitute forward-looking statements. These statements relate to future events. All statements other than statements of historical fact are forward-looking statements. The use of the words ‘‘may”, “expects”, “believes”, “anticipates” and other words of a similar nature are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Although Tornado believes these statements to be reasonable, no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this news release should not be unduly relied upon. Such statements include statements with respect to: (i) the closing of the Rights Offering, and that the conditions for completion of the Rights Offering, including regulatory approval, will be met; (ii) the expansion of the hydrovac business to China, and the results, if any, thereof; and (iii) any increase in revenue and profitability of the hydrovac business and the success of any efforts in respect thereof. Actual results could differ materially from those anticipated in these forward-looking statements as a result of prevailing economic conditions, and other factors, many of which are beyond the control of Tornado. The forward-looking statements contained in this news release represent Tornado’s expectations as of the date hereof, and are subject to change after such date. Tornado disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as may be required by applicable securities regulations.